Exam (elaborations)
NMLS FINAL EXAM REVIEW QUESTIONS UPDATED VERSION STUDY GUIDE; 100% ACCURATE & VERIFIED SOLUTIONS; GRADED A+
This exam gives a comprehensive revision summary for scholar to achieve great heights in NML EXAMS
[Show more]
Content preview
NMLS FINAL EXAM REVIEW QUESTIONSUPDATED VERSION STUDY GUIDE
Who is responsible for ensuring that the Closing Disclosure is delivered to the consumer?
A.The creditor
B.The loan processor
C.The consumer
D. The CFPB - ANS-A. the creditor
Which law restricts the sharing of information given when a consumer applies for a mortgage loan?
A. Fair Credit Reporting Act
B. FTC Disposal Rules
C. Gramm-Leach-Bliley Act
D. Consumer Regulatory Protection Act - ANS-C. Gramm-Leach-Bliley Act
Which document actually contains the borrower's promise to repay the loan?
A. The deed
B. The mortgage
C. The note
D. The TIL Disclosure - ANS-C. The note
The practice of intentionally targeting borrowers in poor or underserved areas with predatory loans is
known as:
A. Redlining
B. Steering
C. Misappropriation
D. Reverse redlining - ANS-D. Reverse redlining
If a lender wants to obtain copies of a borrower's tax returns, the borrower is asked to sign what?
A. 4506-T
B. A waiver of financial information
C. 1003
D. 1040 - ANS-A. 4506-T
An increase in fees and issuance of a revised Loan Estimate to reflect the new amounts is permitted in
which of the following cases?
A. The creditor failed to provide an accurate estimate of transfer taxes and wants to issue a revised Loan
Estimate showing actual costs
,B. The consumer is not allowed to shop for flood zone determination services and the actual costs are
more than the estimated costs
C. The title company affiliated with the lender decides to charge more for its services than initially
disclosed
D. The consumer has failed to respond to a loan officer within ten business days and the lending terms
have changed - ANS-D. The consumer has failed to respond to a loan officer within ten business days
and the lending terms have changed
All of the following are true of FHA fixed-rate loans, except:
A. They require upfront MIP on all loans
B. They are available in 15- and 30-year terms
C. The borrower is only required to carry MIP until the LTV reaches 78%
D. The borrower must make at least a 3.50% investment - ANS-C. The borrower is only required to carry
MIP until the LTV reaches 78%
Previously used as compensation for mortgage professionals, yield spread premiums must now be used:
A.As referral fees paid to the broker by a settlement service provider
B. As credits to the borrower to help pay settlement costs
C. As commissions paid in addition to mortgage broker compensation
D. As credits off of the interest rate of the loan - ANS-B. As credits to the borrower to help pay
settlement costs
On which portion of the loan application would one find a street address and legal description of the
property?
A. Section X
B. Section II
C. Section XV
D. Section III - ANS-B. Section II
Which of the following best describes the legal consequences of providing an inflated description of
income on a loan application?
A. It is not an illegal act, but may impact the consumer's credit score
B. It is a violation of multiple federal lending laws and constitutes fraud
C. It is not a violation of criminal laws, and any penalties imposed are civil, not criminal
D. It is not illegal if the applicant inflates his or her income to secure approval for the loan but fully
intends to repay the obligation - ANS-B. It is a violation of multiple federal lending laws and constitutes
fraud
Which of the following is permitted as a result of a referral?
A. A free monthly pass to the gym with each closing
B. A well-written thank you note
C. A coffee card for each client
D. The names, phone numbers, and annual incomes of clients who have applied for loans - ANS-B. A
well-written thank you note
What agency ensures that GSEs are using sound financial practices and have adequate capital to engage
in the mortgage business?
A. The Federal Housing Finance Agency
, B. The Department of Housing and Urban Development
C. The Office of the Comptroller of the Treasury
D. The Office of Federal Housing Enterprise Oversight - ANS-A. The Federal Housing Finance Agency
What is the maximum fee that may be charged for preparation of the Closing Disclosure?
A. $50
B. .1% of the loan amount
C. $0
D. 1% of the loan amount - ANS-C) $0
Don is refinancing his home in order to save money. If the loan goes through, his payment will drop from
$2,000 per month (PITI) to $1,500 per month (PITI). Don's gross income each month is $6,800, but he
has a $300 car payment, a $150 credit card payment, and monthly alimony payments of $1,300. What is
Don's housing ratio on the proposed loan?
A.29%
B.31%
C.48%
D. 22% - ANS-D) 22%
In this case, his proposed housing expense (PITI) will be $1,500/month. $1,500 / $6,800 = 22%
Mishandling borrowers' funds or improperly managing their funds is a practice prohibited by:
A. TILA
B. FNMA
C. RESPA
D. GLB - ANS-C. RESPA
When a loan is characterized as "conforming," it means the loan:
A. Requires no PMI
B. Meets guidelines established by Fannie Mae and Freddie Mac
C. Meets standards for a government program
D. Is a 30-year fixe - ANS-B. Meets guidelines established by Fannie Mae and Freddie Mac
A buyer pays $200,000 for a home and gets a fixed-rate loan from his lender at 5.75%. He puts $40,000
down. What is the LTV on this loan, and does the buyer have to pay PMI?
A. 80% and YES
B. 90% and YES
C. Unknown - need to know the term of the loan to determine
D. 80% and NO - ANS-D. 80% and NO
Which of the following is true of disclosures required by the Homeowners Protection Act?
A. Borrowers can accelerate payment and request to cancel MIP as soon as they reach 80% LTV
B. Lenders can require homeowners to purchase PMI if they have an LTV of less than 80% under certain
circumstances
C. High-risk loans do not meet the guidelines of FHA, VA, or USDA
D. Borrowers with lender-paid PMI are not protected by the HPA - ANS-D. Borrowers with lender-paid
PMI are not protected by the HPA
The benefits of buying summaries with Stuvia:
Guaranteed quality through customer reviews
Stuvia customers have reviewed more than 700,000 summaries. This how you know that you are buying the best documents.
Quick and easy check-out
You can quickly pay through credit card or Stuvia-credit for the summaries. There is no membership needed.
Focus on what matters
Your fellow students write the study notes themselves, which is why the documents are always reliable and up-to-date. This ensures you quickly get to the core!
Frequently asked questions
What do I get when I buy this document?
You get a PDF, available immediately after your purchase. The purchased document is accessible anytime, anywhere and indefinitely through your profile.
Satisfaction guarantee: how does it work?
Our satisfaction guarantee ensures that you always find a study document that suits you well. You fill out a form, and our customer service team takes care of the rest.
Who am I buying these notes from?
Stuvia is a marketplace, so you are not buying this document from us, but from seller Delmahubcham. Stuvia facilitates payment to the seller.
Will I be stuck with a subscription?
No, you only buy these notes for $13.99. You're not tied to anything after your purchase.
Can Stuvia be trusted?
4.6 stars on Google & Trustpilot (+1000 reviews)
63950 documents were sold in the last 30 days
Founded in 2010, the go-to place to buy study notes for 15 years now